The Argentinian government blocked credit card companies from dealing with Uber, causing the ridesharing company’s national branch to use Bitcoin instead.

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The Argentinian government blocked credit card companies from dealing with Uber, causing the ridesharing company’s national branch to use Bitcoin instead.

The city of Buenos Aires issued orders both to the national communications agency (ENACOM) and credit card companies to block the Uber app and deny the company use of credit card service. This prompted Uber to partner with Swiss Bitcoin company Xapo to enable payments through Bitcoin debit cards.

Part of an ongoing war against Uber

The ride-sharing company has faced harsh resistance in Argentina, particularly in Buenos Aires. Taxi unions sued the city and Uber, resulting in a judge issuing an injunction to stop ride-sharing services in the city. Later, both a prosecutor and a judge ordered ENACOM to block the Uber app within the city limits. Finally, both the consumer protection agency of Buenos Aires and a judge ordered credit card companies to cease doing business with Uber.

As a response to this perceived threat to the taxi industry, the transportation agency of Buenos Aires has announced development of a taxi app. This app, dubbed BA Taxi, is expected to help provide a government-sanctioned answer to the convenience of Uber’s app.

Uber users adapting and using Bitcoin

By and large, Uber’s customers are adapting well to using Bitcoin through Xapo’s debit card, for which Uber gave a $30 discount. Diego Gutierrez Zaldivar, President of Bitcoin Latam and CEO of RSK Labs, sees Uber’s typical customer as being willing to embrace new technology.

“In general Uber users are highly knowledgeable about technology and more prone to Bitcoin understanding and usage, fears about Bitcoin usually come from more illiterate users.”

According to Franco Amati, co-organizer of the Latin American Bitcoin Conference (laBITconf), most users have flocked to Bitcoin rather than lose Uber.

“Nobody is deleting Uber app because of this, on the contrary, I have friends that requested Bitcoin debit cards to use Uber. Most of them from SatoshiTango, since there they have an option for a virtual debit card, so they do not even need to wait for a physical card to be delivered. But others from Xapo too as card issuer.”

Amati also notes that Uber’s difficulties from authorities were what prompted this sudden explosion of interest in Bitcoin.

“Also, have in mind that Uber was not accepting these cards a month ago. They added them because in Argentina all local cards are blocked by the government from using Uber (even when these cards are used outside of Argentina).”

Zaldivar is optimistic about Bitcoin’s future in Latin America as the cryptocurrency becomes an increasingly attractive option compared with government money.

“Confidence in Bitcoin is growing steadily in Latam as the years go by and the technology proves to be resilient while the currency proves to be a safe haven compared to the highly inflationary national currencies.”